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The evolving
The evolving role of strategic role of SMD
management development
Paul Brown
University College Northampton, Northampton, UK 209
Received May 2004
Abstract Accepted May 2004
Purpose – To validate conceptual frameworks for strategic management development. Also, to test
the hypothesis that the objectives and design of a strategic management development programme
need to match the organisation’s level of commitment to strategic management and the degree of
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maturity of its strategic management processes and competencies, in order that the programme can be
effective in enhancing the strategic capability of the organisation.
Design/methodology/approach – Earlier work by the author (based on literature review and one
case study) had generated two conceptual models which could help in the understanding of strategic
management development. One provides a life-cycle typology matching an organisation’s level of
commitment to strategic management with the design of an effective strategic management
development programme. The second provides a causal network showing how strategic management
capability may be developed. In this paper case study research is reported from six organisations to
provide data, which are mainly qualitatative, to test the hypothesis and conceptual models.
Findings – Both the life-cycle typology and the conceptual models are supported by the further case
study work. It was also found that the dominant strategy-making mode in the organisation can
influence the potential for strategic management development. Where the command mode of strategy
making is dominant the strategic aspects of a management development programme are inhibited
because this is not consistent with the command culture.
Research limitations/implications – The generalisability of the findings is constrained by the
small sample size of six organisations. However, given the paucity of theory in the field of strategic
management development, the findings contribute to the conceptual understanding of this subject.
Originality/value – The models proposed give insights into the complexities of strategic
management development and can be used to inform analysis and planning of more effective
strategic management development interventions.
Keywords Strategic management, Corporate strategy, Management development
Paper type Conceptual paper
Introduction
For over 15 years it has been contended that management development (MD) has a
strategic role to play in organisations. Constable and McCormick (1987) recommended
that MD should be an integral part of strategic plans and strategic change. Cannon
(1994) proposed that MD needed a renewed emphasis on its impact on corporate
performance and improved competitiveness. Thomson et al. (1997) reported that MD
was lagging behind and derived from change rather than helping to shape it, and was
inadequately linked to organisational strategies. These UK findings were mirrored in
US studies (e.g. McClelland, 1994; Seibert et al., 1995). Journal of Management Development
Vol. 24 No. 3, 2005
Such findings drove attempts to identify “best-practice” in MD, especially for senior pp. 209-222
managers who were thought to be most able to influence strategy and performance q Emerald Group Publishing Limited
0262-1711
(e.g. Cannon, 1995; Hussey, 1996; Bolt, 1993; Burack et al., 1997; Michael, 1993; DOI 10.1108/02621710510584035
JMD Osbaldeston and Barham, 1992; Seibert et al., 1995; Horwitz, 1999; Boshyk, 2000; James,
2001).
24,3 While considerable consensus emerged from such studies and there was a strong
empirical and practitioner foundation, there was a paucity of conceptual frameworks
and theory to help explain the phenomena described. The emphasis was on practice
from well-known and well-regarded organisations which were thought to be doing
210 something right. Such theory and conceptual frameworks as did exist were mostly
from mainstream MD thinking, which did not necessarily emphasise the strategic
contribution of MD. A few models were helpful in positioning different types of MD,
some of which had a strategic role (e.g. Patching, 1998; Talbot, 1997). However,
exploration of the contingency factors that might help determine which type of MD is
best suited to a particular situation remained under-developed.
This research was designed to make a contribution towards filling some of these
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knowledge gaps, thus increasing the understanding of whether and how MD can
realise its strategic potential.
211
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Figure 1.
Causal network showing
how strategic
management capability
may be developed
JMD complement, and encourage, the development of organisational and individual
24,3 competencies in strategic management. This matching might, over time, evolve
through a number of stages as shown schematically in Table I. It is also inferred in the
hypothesis that the development of strategic management capability will lead to
improvements in the corporate performance of the organisation. Table I builds on the
ideas of Gluck et al. (1982) and Newkirk-Moore and Bracker (1998) as well as the
212 research (Brown, 2003, 2004) described above.
It is possible that an organisation with a low commitment to strategic management
will be in a slow-changing environment, or in one that has only recently experienced an
increase from low to higher levels of dynamism and/or complexity. Therefore as the
level of environmental turbulence (dynamism and complexity) increases it is likely that
the organisation will need to move to higher levels of commitment to strategic
management and the life cycle sequence of Table I may be followed. An alternative
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Commitment to
strategic management Organisational features Role of SMDP
Low (level 1) Strategy “stuck” except for low levels Introduce knowledge and language
of emergent/incremental change of strategic management
Strategic drift Exploratory discussions on
Little participation in strategy strategic direction
making “Forming” stage of teambuildinga
Change projects rare/poorly handled among senior managers
Mutual support role for participants
Emerging (level 2) Experimentation with mechanisms Forum for discussing proposals and
for strategic debate and decision recommending strategies
making Confronting issues: “storming”
New language of strategic stage of teambuilding
management Recognition of need for strategic
Greater participation management competencies
Uncertainty over strategic direction
Dissatisfaction with current strategy,
i.e. position or performance
Developed (level 3) Embedding of mechanisms for Competencies in strategic
strategic debate and decision making management defined and being
Consensus on strategic direction can developed
be achieved Cascading of organisational
Systems and processes adapted to strategy to managers’ own units
facilitate strategic management “Norming” stage of teambuilding
Mature (level 4) High commitment to strategic Strategic implementation through
management evident through culture project teams and cascading of
and systems change projects
Continuous review of high-level Succession planning and cascade
strategies development of strategic
Effective implementation of strategy management competencies
“Performing” stage of teambuilding
Table I.
Evolving role of SMD Source: a Tuckman (1965)
strategic management commitment and/or capability, for example, the reactor and The evolving
defender styles of Miles and Snow (1978). role of SMD
In contrast the prospector and analyser styles (Miles and Snow, 1978) require
stronger strategic management commitment and capability. That organisations may
operate in similar environments, but have different levels of commitment to strategic
management, was demonstrated in the case of small American banks studied by
Newkirk-Moore and Bracker (1998). It was found that business performance was 213
highest when levels of both commitment to the strategic planning process, and the
frequency of strategic planning training, were high.
The aim of this research, therefore, was to test the hypothesis and life-cycle model
using a small number of case study organisations. There will be limitations to the
generalisability of the funding because of the sample size. However, this methodology
does allow the gathering of rich qualitative data, and the use of qualitative approaches
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to test theories has been defended by Van Maanen (1983) and Yin (1990).
Strategy-making modes
Some explanation is now given of strategy-making mode, which was to emerge as an
important variable in the study. Hart (1992) produced a typology of five
strategy-making modes which has gained wide acceptance as a theoretical model.
The typology has implications for SMD in outlining alternative processes for strategy
formulation with which SMD might interact, and identifying strategy-making modes
which engage multiple levels of management.
In the Command Mode strategy is made by a strong individual leader supported
by a few top managers. Analysis and option evaluation is used to provide deliberate,
fully formed, ready to implement strategies. Other people in the organisation are
“good soldiers” who execute the strategy. This might work in an industry
environment that is relatively simple and hence can be understood by one or a few
people. The organisation will probably be relatively small, so that one person can still
maintain effective control.
In the Symbolic Mode top management creates a clear and compelling vision, which
gives meaning to the organisation’s activities and provides a sense of identity for
employees. This long-term vision can be translated into specific targets and there is an
implicit control system based on shared values. Speeches, persuasion, new projects and
recognition provide focus and momentum to guide the creative actions of individuals.
The flexibility of this mode is said to suit dynamic environments, and larger more
differentiated organisations which may be growing or re-orienting through proactive
strategies (such as prospector or analyser (Miles and Snow, 1978)).
In the Rational Mode there is a more comprehensive system of formal strategic
planning with written strategic and operating plans. There is upward sharing of data
and a high level of information processing and analysis. Detailed plans and
well-developed control systems are seen. It is likely to be found in larger firms
defending established strategic positions in relatively stable environments (defender
strategies).
The Transactive Mode employs strategy making based on interaction and learning
rather than the execution of a predetermined plan (which is precluded by the inability
of top management to understand a complex environment fully). Features of this mode
are cross-functional communication, feedback and learning, and dialogue with key
JMD stakeholders, thus necessitating an iterative approach to strategy making. Initiatives
24,3 such as just-in-time (JIT), total quality management (TQM) and customer focus provide
vehicles for these transactions. Top management is concerned with facilitation and
linking outcomes over time to determine strategic direction. This is said to suit large
mature firms operating in complex environments, e.g. following analyser strategies
aimed at incremental product or service improvement.
214 Finally, the Generative Mode has features that were also highlighted in the work of
Burgelman (1983), and Wooldridge and Floyd (1990). New ideas emerge upwardly from
“intrepreneurship”. Top managers mainly encourage experimentation and select and
nurture high-potential proposals. New strategies are germinated by separating
innovative activity from the day-to-day work of the operating organisation. Product
champions, who can link new ideas with organisational resources to make them a
commercial reality, are important. The strategy is continuously adjusted to reflect the
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pattern of high potential innovations that emerge from below. This mode is said to suit
turbulent environments, and prospector strategies in complex and fragmented
markets.
Hart’s later empirical work (Hart and Banbury, 1994) produced evidence that the
more an organisation was able to develop competence in multiple modes of the
strategy-making process, the higher its performance. Modes may combine
sequentially, e.g. symbolic vision from senior management followed by generative
invention and implementation from middle managers. These findings were
theoretically associated with the resource-based view of strategy. Firms able to
accumulate more complex resources and capabilities in strategy making should be
more successful at sustaining competitive advantage than those firms with simpler or
less-developed capabilities (Barney, 1991, cited in Hart and Banbury, 1994).
Research design
To test the main hypothesis, and the associated model (Table I), it was necessary to
extend the study beyond the single organisation of the original case study (Brown,
2004). It was decided to select a number of UK organisations which displayed a range
of levels of commitment to strategic management (as indicated through the
operationalisation of this concept in a pilot postal questionnaire) and which had senior
MD programmes. Five organisations were selected for more detailed study using
semi-structured interviews and company documentation. Anonymised details of these
organisations, together with the organisation studied in the first case study, are shown
in Table II.
annually. Corporate plans are produced by a central strategy team reporting to the
chief executive. Each divisional plan is produced by the divisional senior management
team (including the general managers of business units), which has someone with
specific responsibility for strategy. That person and the divisional managing director
present the strategic review to the main board. The strategy-making process has a
strong upward (from divisions) thrust and a demand for entrepreneurship at business
unit level, exhibiting features of Hart’s Rational and Generative modes.
There are systems to support the strategic management process – the annual
resource planning and development cycle provides a resource plan to link to the
strategic plan (though it does not strongly incorporate human resource planning apart
from senior management succession planning and “talent spotting”).
The strategic process is supported by statements of mission, values and key
strengths. Overall the organisation’s strategy is thought to be durable over time, and
communication of it is good at corporate and business unit levels, but less so at
divisional level where there is often uncertainty about “how the different business
units fit together, what the synergies are, and where we should be looking to expand
capability”.
These organisational features provide evidence of progression to the highest level of
commitment to strategic management (CSM) in Table I. The features of level 3 such as
the embedding of systems for strategic debate and decision making, and systems and
processes to facilitate strategic management, have been seen to exist. Indicative of level
4, there is a continuous (annual) strategic review and a high commitment to strategic
management is apparent from – for example – the central strategic planning team and
the divisional senior managers who have particular responsibility for strategic
management. The company has reported impressive growth and strong and
improving financial results – this may be taken as evidence of the effective
implementation of strategy.
There are some areas where improvements in commitment to strategic management
might be sought but these shortcomings can be viewed in the context of the continuing
development of strategic management, which was evident in the company.
There are three different MD programmes that operate at senior or strategic level.
The “core senior management programme” is targeted at those newly appointed to the
senior management team of a business unit. Formal training inputs are phased to cover
strategic management, implementation and control, while simultaneously each
JMD delegate works on a strategic plan for his/her own business unit. This is then presented
24,3 to the sponsoring senior management team. The strategic planning project is
“fundamentally a learning process . . . but there should be some stuff in there that is
really capable of being adopted”. However, because delegates are relatively new in post
“there can be issues of people’s ability to get a platform or have the authority to take
some of the ideas forward”. To help encourage the implementation of ideas there is a
216 review after four to five months to look at progress made. There is no formal link
between the project and the annual performance appraisal process. One of the benefits
of the programme is in bringing delegates together from disparate parts of the
company and “some of the best projects have actually looked at harnessing capabilities
from different bits of the company to create a whole new business opportunity”.
This programme clearly uses real strategic business issues as learning vehicles, and
does sometimes produce direct business benefits from the projects. While the
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interaction between delegates is a key element this is not formalised within the
structure of the programme – greater group involvement in the project work could be
beneficial. Also greater linkages with the performance appraisal system might help
provide support for the development and implementation of ideas.
Another programme, attracting 400 middle managers, is clearly aligned to one of
the main elements of the company’s strategy. Described as “more of an OD
intervention”, the emphasis is on defined behavioural skills associated with building
strategic partnerships with clients, change management and entrepreneurship. It is
intended to break down internal barriers so that all of the company’s capability can be
brought to bear on any particular client’s needs. Learning networks, line manager
mentors and personal learning contracts are used. Participants work on live business
issues with inter-module assignments and are encouraged on residential modules to
experiment with new behaviour in a safe environment.
When mapped against the SMDP dimension of Table I the requirements of level 3
are seen to have been met. The defining and developing of strategic management
competencies (such as strategic partnership skills), and the cascading of organisational
strategy to managers own units (in the core programme) are evidenced. There is less
evidence that the use of MD for strategy implementation is strongly present, since the
interventions described are mostly concerned with learning rather than real strategy
implementation. Where real strategy implementation is attempted it is somewhat
disconnected from the mainstream strategic management process and does not carry
the full support of other senior managers and directors. Nevertheless, this programme
does have a strong strategic focus, and strategic management competencies are being
cascaded within the organisation – e.g. through the line manager’s
coaching/mentoring role. Also, the company’s MD programmes do clearly support
succession planning. In these respects a number of the hypothesised conditions for
level 4 are met. Overall the programmes have some strong strategic roles, and advance
beyond level 3, though not fully meeting the level 4 role of SMDP in the typology. The
evaluation of the programmes indicated that they were successfully contributing to
strategic capability.
Analysis
Table III analyses possible objectives for MD programmes (derived from literature
review) that were included in the postal questionnaire, sub-dividing them into those
Strategic Functional
The evolving
role of SMD
Developing abilities to manage change Improving current job performance
Developing abilities in strategic management Developing managers to handle a bigger job
Developing entrepreneurial behaviour Identifying high-fliers for succession planning
Encouraging innovation and creativity
Helping formulate or refine corporate strategy Preparing managers for lateral moves
Developing leadership ability
217
Helping the organisation achieve its strategic Building teamwork and networks
objectives
Communicating and clarifying corporate strategy
Shaping and modifying a culture Table III.
Creating a common purpose Classification of
Creating a cadre of change agents objectives in SMDP
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with a strategic emphasis and those with a more functional or operational emphasis.
The interpretation of strategic used here has included change management,
innovation/creativity and entrepreneurial behaviour as well as other strategic
management aspects. It was evident from the interview analysis that some of the SMD
programmes did not have a strong strategic focus, and this concept was
operationalised as the SMD score.
The SMD score (maximum 4.0) was derived from the postal questionnaire results to
reflect the extent to which strategic objectives for the MD programme were set and
achieved. This can be contrasted with the functional management development (FMD)
score (maximum 4.0) which measured the extent to which functional/operational
objectives were set and achieved.
Table IV shows the results for each of these variables. The data indicate that for
organisations B and C the programme was not designed to have a strong strategic
effect. The other four organisations all scored above the midpoint on the scale for
strategic objectives. The indication that in B and C the programmes did not have a
strong strategic role was supported by the interview data. For B, the programme
(which was organised at group level) was not deemed to be very successful and did not
Hypothesis testing
Table IV provides a basis for testing the main hypothesis, by examining the
relationship between the organisation’s CSM (CSM level) – and the design of the SMD
programme (SMDP level).
It has been seen that in the cases of two organisations (B and C) the senior MD
programmes do not have strong strategic aims. For B, although the organisation has a
strong commitment to strategic management, the MD programme was commissioned
at group level and has no direct links with the division’s strategy. While this may not
be an optimal situation, it seems that it is tolerated because the slow-changing
environment in which B operates has not provided sufficient stimulus to move to a
more strategic form of MD (as reflected in the low SMD score of 1.7). Thus there is
mismatch between CSM and SMDP levels (shown as level 4 and level 1 respectively).
However the SMDP at B is not considered to be very effective and would probably
benefit from further development to a higher level on the typology. This is consistent
with the hypothesis, i.e. because of the mismatch between CSM and SMDP levels the
programme is not effective in enhancing strategic capability.
In the case of C, the organisation apparently has a high CSM level. From the
interview data many aspects of Level 4 were seen. However, because the dominant
strategy-making mode is Command there is little participation by managers in the
strategy formulation process. This aspect is therefore also absent from the SMDP
which was judged to be at level 1. The programme does not have prominent strategic
management aims and this is probably a reflection of the Command style. This
situation may be acceptable because although the organisation’s environment is
dynamic it is not especially complex. There is not a strong international dimension,
and the organisation’s activities are focused in financial services rather than being
diversified. Therefore the executive directors may be able to monitor environmental
trends and competitive action and make the key strategic decisions needed. The
evidence from C is that the hypothesis is supported.
The Command strategy-making style is also exhibited by D. Again it was found
that the senior MD programme does not contribute significantly to strategy
formulation, which is consistent with the Command style. Hence although there is a
high commitment to strategic management (Level 4) this is not reflected in the SMDP.
Like C, D has apparently been able to prosper under a Command mode (and in both
cases this is accompanied by elements of the Rational strategy-making mode). D also The evolving
has a relatively simple environment, uncomplicated by diversification and, to a more role of SMD
qualified extent, international considerations. (D does consider itself in competition
with some prestigious overseas retailers). Where D does differ from C is in a desire to
see some change in the strategy-making mode. There are demands for senior managers
to be more innovative, and for better change management. This is moving the
organisation to more Generative and Transactive modes. To support this the SMDP 219
has a greater strategic emphasis, at least in its intent – as demonstrated by an
emphasis on vision and strategic awareness in the programme, and by the high scores
for strategic objectives (SMD score ¼ 3:0). However the SMDP does not connect closely
with the strategic aims and business development processes of the organisation, and
only very limited progress has been made in widening the strategic thinking capability
in the organisation. Difficulty had been experienced in making managers more
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interactions.
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